Doing a 2nd update this week for trades done in one of my other portfolios - some different themes there.
Portfolio News
Two key updates to start the week - Ever Given is released in Suez Canal and traffic starts to flow again. Suez Canal Authority say they will have the backlog cleared in 3 and a half days.
Financial markets are roiled by massive margin losses from hedge fund manager, Archegos Capital. Biggest losers look to me Credit Suisse and Nomura. Well of the banks that have owned up - Goldman Sachs looks like they offloaded in the nick of time
This article has a little more detail on which companies were embroiled in the meltdown.
Big movers of the week in this portfolio were in oil shipping with two stocks rising over 11% from the week lows (NAT and TK). I was onto that.
Bought
Deutsche Bank AG (DBK.DE): German Bank. Replaced assigned stock at 4.5% premium to assigned price. Covered call written at 1.9% premium with 5% coverage.
The Boeing Company (BA): US Aerospace. Replaced some assigned stock at 5.8% premium to assigned price. This add was a rounding up to write covered calls again. Covered call written at 1.1% premium with 14% coverage. News that Southwest Airlines (LUV) placed an order for 100 737 Max 7 aircraft has under-pinned the price nicely.
Ford Motor Company (F): US Automotive. Added another parcel to one portfolio - Jim Cramer idea to keep going on Ford. Covered call written at 3.0% premium with 5.6% coverage.
Alerian MLP ETF (AMLP): US Oil. With oil prices rising and only holdings in Royal Dutch Shell (RDSA.AS) in this portfolio I added a small holding in this ETF. Implied volatility on options is a bit higher than one gets on the SPDR Oil Producers ETF (XOP)
Nordic American Tankers Limited (NAT): Oil Shipping. Averaged down entry price following the uptrend in oil shipping prices. Chart from TIB529 shows this is the biggest relative underperformer in the oil shipping sector since the November 2020 lows. NAT is the blue line at the bottom
Teekay Corporation (TK): Oil Shipping. Increased holding size to diversify individual company risk. TK is the light blue line in the chart above.
Eli Lilly and Company (LLY): US Pharmaceuticals. Rounded up holding to be able to write covered calls. Jim Cramer idea to average down.
iShares MSCI Turkey ETF (TUR): Turkey Index. President Erodgan replaces head of Turkish Central Bank - Turkish lira collapses and this ETF dropped 21% from Friday close (March 19) to Monday open.
Averaged down my long standing holding in Turkey as I feel the market response will be an over-reaction as it normally is. Next day, I also constructed a call spread risk reversal. I bought a January 2022 24/30 bull call spread with a net premium of $1.90 - this offers a maximum profit potential of 215% for a 28% move from my $23.425 entry the day before. I funded the net premium fully by selling a November 2020 strike 20 put option which is a 17% price drop protection. I cannot see price dropping 38% in total between March 19 and November.
Let's look at the chart which shows the bought call (24) as a blue ray and the sold call (30) as a red ray and the sold put (20) as a dotted red ray with the expiry dates the dotted green lines on the right margin
The sold put is around the level of recent lows including the Covid low in March 2019. Those 4 lows look like a solid bottom to the chart. The sold call (30) is around the level of recent highs. I have highlighted the dates for the 3 prior changes of central bank governor. A repeat of the drop from the April 19, 2016 sacking of Murat Çetinkaya who had been in office 5 years will be ugly - the rest look like blips.
https://en.wikipedia.org/wiki/List_of_Governors_of_the_Central_Bank_of_the_Republic_of_Turkey for dates
NVIDIA Corporation (NVDA): US Semiconductors. Jim Cramer idea to take a nibble. With closing price of $522.83, I sold an April expiry 475 strike put option at 0.89% premium with strike 10% below closing price (March 23). Next day I did also buy 10 shares at $520.09.
L&G Clean Energy ETF (RENW.SW): Renewable Energy. Was researching the L&G Hydrogen ETF (HTWO.SW) and came across the ETF from the same stable - added a small holding as a long term view on the move to renewables. This is a Swiss listing which essentially hedges the holding in Swiss Francs.
Cautions: This is not financial advice. You need to consider your own financial position and take your own advice before you follow any of my ideas
Images: I own the rights to use and edit the Buy Sell image. News headlines come from Google Search. All other images are created using my various trading and charting platforms. They are all my own work. Oil Tanker by Jaime Carrion from the Noun Project
Tickers: I monitor my portfolios using Yahoo Finance. The ticker symbols used are Yahoo Finance tickers
Charts: http://mymark.mx/TradingView - this is a free charting package. I have a Pro subscription to get access to real time forex prices
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March 22 - 26, 2021
Posted Using LeoFinance Beta
Turkey chart label for sold call should be sold call 30 - caching will not allow an edit
Posted Using LeoFinance Beta